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energy and climate change policy in the UK Parliament from Alan Whitehead MP

No news here – EDF doesn’t pay for something again

Something a bit odd is happening in Somerset, and I don’t mean that a new series of Midsomer Murders has been commissioned (I rather think it is set in Somerset, but I’m not sure…). No, the oddness relates to the community bounty promised upon the eventual arrival of Hinkley C nuclear power station in West Somerset.

You will recall, no doubt, the excited announcement by Michael Fallon last year; residents of the local authorities around the plant would be receiving, in addition to retention of the business rate, around £1000 per megawatt hour for up to forty years once the plant was producing power. That might amount to some £128 million all in, which is not bad going at all for cash-strapped local authorities. The previous year, EDF had announced that they would be lavishing some £64 million on local communities to get the project going. So, presumably, like the £5000 per installed megawatt that onshore wind developers are committed to provide for communities (provided that nice Mr Pickles lets them build any) and the 1% of revenues fracking well companies will have to donate to communities if they consent to a well and it actually produces anything, nuclear developers will also be supporting local communities.

Well, not exactly, as it turns out. Pretty much all the money that EDF have provided so far has gone on things that benefit…er…EDF – like widening access roads and so on. And, so I understand, the company has flatly refused to have anything to do with developer benefits subsequently. And following the strong hand DECC played in the negotiations throughout, flat refusal was indeed how it turned out. Only someone had to stump up the community benefit money after Michael Fallon’s possibly injudicious announcement. I am also told that further negotiations with Treasury have proved fruitless.

There have been some suggestions that the lucky authorities who might otherwise benefit from the community payout will share the undoubted bounty of the promised business rate remission. But since the plant itself will be built entirely within the West Somerset district boundary, it is this local authority who will get the whole lot. Other authorities will get nothing, even though they will get a lot of the effects coming their way. West Somerset is understandably reluctant to pass up the equivalent of a large lottery rollover win, so that avenue looks to be closed. The Treasury has now apparently told DECC that they are on their own and that any community benefit will have to be paid out of departmental funds, unless they can get EDF to cough up, which of course they can’t.

So there we are: cash strapped DECC likely to be paying out £128 million for the developer (who will pay virtually nothing in community benefit) over forty years, and local authorities in the area still left a little unclear about how this will all happen. The only good part of this sorry story is there is quite a long time to go before they will have to pay anything out. And perhaps someone will have found some money under a stone by then.